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TMI Blog2012 (10) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... dition made by the AO of Rs..4,64,139/- as "unaccounted excess stock" based on approval memos and cash memos impounded during the course of survey proceedings ignoring the facts that assessee has not produced any material evidence of inclusion of the above items in the stock of materials inventorised in survey proceedings." 02. On the facts and circumstances of the case as well as in law, the Ld.CIT(A) erred in law in deleting the addition of Rs..5,46,322/- on account of estimated profit on basis of seized documents found during the course of search/survey operation from office of Anoopchand group ignoring the facts no substantial evidence was produced by the assessee, either before the AO or before Ld. CIT(A) in support of its explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds accounted in the closing stock. The Assessing Officer did not accept the said contention and added the value of stock mentioned in the cash memos at 822.94 gms and added the value of the same for sum of Rs..4,64,139/-. Further in regard to transaction with M/s Anoopchand Tilokchand Jewellers Pvt. Ltd., the Assessing Officer found that certain loose sheets were found which contained details of unaccounted cash transaction with the said party. The said loose papers contained transaction relating to M/s Sangam Chain, which was denied by the assessee not only during the course of survey but also before the Assessing Officer. The Assessing Officer rejected the said explanation and worked out the undisclosed income on account of labour job do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cepted anything in respect of these notings. Not only that, the assessee has also denied any cash transaction with the said party. Various judicial pronouncements were relied upon by the assessee that such an evidence cannot be admitted for drawing any adverse inference in the case of the assessee. The lists of such case laws are given at page 11 to 14 of the appellate order. Alternatively, it was argued that even if such an undisclosed income is added in the hands of the assessee, the same is reflected in the stock as addition of undisclosed income was made on purely estimate basis on the job work of gold chains. 7. Learned CIT(A), albeit did not accept the assessee's first contention that the paper impounded at the time of survey, do not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcess stock was surrendered. Therefore there was no occasion to make separate addition over and above. He, thus, strongly relied upon the findings of the CIT(A). On the issue of estimated profit of Rs..5,46,322/-, he submitted that the very document from which such an estimate was made, was inadmissible as an evidence in the case of the assessee as the same was uncorroborated as not only the assessee has denied the seized paper but also denied by the third party. Further he submitted that even otherwise also the job work was only for making gold chains as the assessee was not only in the business of manufacturing of gold chains out of his own stock of gold but was also doing making of gold chain as a job work. Once the entire undisclosed st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of survey and secondly, the undisclosed income can be set off against unaccounted stock found which has been surrendered by the assessee at the time of survey. The reasoning of the CIT(A) is based on several judicial precedents including that of Hon'ble Supreme Court in the case of Anantram Veerasinghaiah & Co. Vs. CIT, reported in 123 ITR 457 (SC), that undisclosed income is available for set off against undisclosed investment or any other addition. We do not find any infirmity in such telescoping of undisclosed income from undisclosed stock and accordingly the finding given by the CIT(A) is upheld. In the result, ground No.2 raised by the department is also dismissed.
12. In the result, the appeal filed by the department is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X
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